Symbotic Inc. (NASDAQ:SYM) is one of the stocks on Jim Cramer’s and analysts’ radar. On August 25, DA Davidson downgraded SYM shares to Neutral from Buy and raised the price target to $47 from $35. The firm lowered its revenue and adjusted EBITDA estimates for fiscal 2026, citing a slowdown in near-term revenue growth and current valuation. It stated that organic sales are expected to reaccelerate in fiscal 2027 as system deployment rates increase.
Photo by Joshua Mayo on Unsplash
Symbotic Inc. (NASDAQ:SYM) creates automation systems that optimize warehouse operations by automating the movement and processing of pallets and cases. The company’s technology is used to improve efficiency in the early stages of the supply chain. Moreover, the bearish sentiment was also reflected in Cramer’s comment as he called it a “complicated story” on August 11 when he said:
“So, what do we want to make of this stock now that it’s gotten hit? I’m a bit torn on this one. I like the technology and the growth trajectory. I just wish Symbotic were a cleaner story. I’m not super worried about the concentrated Walmart business, but at the end of the day, it’s a problem when you get 87% of your sales from a single company. It’s also tough to value the stock. If we use the consensus earnings estimate for 2026, then the stock’s trading at over 150 times next year’s numbers. If you use the 2028 estimates, Symbotic looks a little more reasonable, just over 25 times that number, but that’s three years out.
If you want to use a price-to-sales multiple, Symbotic trades at about 14 times this year’s… sales, and 14 times sales is far from cheap, frankly. Now I wish the stock had more of a reason to, you know, more than triple. I don’t know why it tripled from its April lows… That bothers me. A lot of this just feels like Symbotic can’t lose in a market that loves AI or automated related, anything robotic. As long as that dynamic continues, the stock’s a winner. But I don’t like to recommend stocks for that reason. At the end of the day, I just don’t feel comfortable enough with this complicated story to stick my neck out for Symbotic.
If you’re thinking long term and if you fully understand the risks and try to understand that short position, the concentration with Walmart, you got my blessing to speculate on this one. Just keep in mind, you’re speculating. Here’s the bottom line: Symbotic’s a cool company, and if you’re comfortable speculating, then you can put a small position on here and potentially buy more on weakness. But overall, I think there are more straightforward ways to speculate this market, but it is cool, I’m not denying that.”
While we acknowledge the risk and potential of SYM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SYM and that has 10,000% upside potential, check out our report about this cheapest AI stock.
READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.
Disclosure: None. This article is originally published at Insider Monkey.
Hedge Fund Resource Center